Carbon pricing and fossil fuel price subsidy reforms will have distributional implications. Kept unmanaged, they will have the power to stop reforms, frequently proven in the past. While it has been found that green fiscal reforms are likely progressive in the context of many low- and middle-income countries, in order to understand the policy implications of such reforms it will be necessary to gain a deep understanding of which societal groups would be affected, and how. In this project, we envisage to systematically map the carbon pricing incidence on households across low- and middle-income countries based on detailed household surveys. This will allow going beyond questions of progressivity/regressivity, hence identifying the most affected groups in a society. This understanding will help to design country-specific compensation schemes that help to make carbon pricing and fossil fuel subsidy reforms politically acceptable.
Related publications:
Dorband, I. I., Jakob, M., Kalkuhl, M., & Steckel, J. C. (2019). Poverty and distributional effects of carbon pricing in low-and middle-income countries–A global comparative analysis. World Development, 115, 246-257.
Ohlendorf, N., Jakob, M., Minx, J. C., Schröder, C., & Steckel, J. C. (2021). Distributional impacts of carbon pricing: A meta-analysis. Environmental and Resource Economics, 78(1), 1-42.
Schaffitzel, F., Jakob, M., Soria, R., Vogt-Schilb, A., & Ward, H. (2020). Can government transfers make energy subsidy reform socially acceptable? A case study on Ecuador. Energy Policy, 137, 111120.
Responsible for all the studies within the EPFD are
E. Somanathan som@isid.ac.in
Jan Steckel Steckel@mcc-berlin.net
and
Tomas Sterner Thomas.sterner@economics.gu.se
